1. 1
Definition of Business
Dr.L.Prakash Sai
By creating new products, spreading technology and raising
productivity, enhancing quality and improving service, business has
always been the active agent of progress.
It helps make the good things of life available and affordable to ever
more people. This process is driven by competition and spurred on by
the need to provide adequate returns to those who risk their money and
their careers, but is, in itself, a noble cause.
We should make more of it. We should, as charitable organizations do,
measure success in terms of outcomes for others as well as for
ourselves.
Charles Handy
What’s Business For ?

2. 2
Business Definitions
Business Definition
Derek F. Abell
Customer functions - What?
Time pieces: record time, fashionable, gift item
Customer groups - Who?
To serve individuals or for Industrial use
Alternate technologies - How?
Mechanical, Quartz digital, Quartz analog

3. 3
Xerox India Ltd. (erstwhile Modi Xerox)
Strategy of pitching itself as a service organization rather than a
vendor of machines (of which there are plenty in India).
 Customer groups - individual organization, government departments,
export market
 Customer functions - provide communication with ease of reproduction
 Technology - high quality, latest available from Xerox Corp., USA.
Xerox India: Action taken....
 Customer Group : efficient high priced & appropriate & low priced
model; Marketing - full service maintenance agreement, renting of
machines.
 Customer functions : high & medium quality photocopier- spares
(drums), consumable items (toner, developer) – after-sales service
support.
 Technology : heavy investments in high-tech manufacturing facilities,
high quality manpower, customer services staff.

4. 4
Dictionary Definition:
Vision is an “image of the future we seek to create.”
 A vision statement describes in graphic terms where the goal-
setters want to see themselves in the future.
 It may describe how they see events unfolding over 5 or 10
years if everything goes exactly as hoped.
Vision
Vision Statements
Indian Oil Corporation
A major diversified, transnational,
integrated energy company, with national
leadership and a strong environment
conscience, playing a national role in oil
security& public distribution.

5. 5
Dictionary Definition:
Mission is a “purpose, reason for being; also, an inner calling
to pursue an activity or perform a service.”
 Mission statement defines the purpose or broader goal for
being in existence or in the business.
 It serves as an ongoing guide without time frame.
Mission
What is our business?
What will it be?
What should it be?
- Underlying need of the society that any organization serves to fulfill
Mission
Mission: To satisfy
information needs of
the society
Book Publisher: To provide excellent
reading material
Magazine Editor: To present news analysis
in balanced and unbiased manner

6. 6
 Feasible
 Precise
 Clear
 Motivating
 Distinctive
 Indicate major components of strategy
 Indicate how objectives are achieved
Characteristics of Mission
Mission, Purpose, Aim, Goal, General Objective, Grand Strategy,
Corporate Objective, Corporate Philosophy – related terms
Mission Statement
Criteria for evaluation
 Is our mission statement is focused on satisfying customer needs rather than
being focused on the product?
 Does our mission statement tells who our customers are?
 Does our mission statement explains what customer needs our company is trying
to satisfy?
 Does our mission statement explains how our company will serve its customers?
 Does our mission statement fits the current market environment?
 Is our mission statement based on our core competencies?
 Is our mission statement motivating and does it inspire employee commitment?
 Is our mission statement realistic?
 Is our mission statement specific, short, sharply focused and memorable.
 Is our mission statement is clear and easily understood?
 Does our mission statement says what we want to be remembered for?

7. 7
Mission & Vision Statements
Our Mission:
 To refresh the world - in mind, body and spirit
 To inspire moments of optimism - through our
brands and actions
 To create value and make a difference
everywhere we engage
Our mission is:
To bring inspiration and innovation
to every athlete* in the world.
*If you have a body, you are
an athlete.
The Coca-Cola Company
Vision of the Coca-Cola Company:
To achieve our mission, we have developed a set of goals, which we will work with our bottlers
to deliver:
 Profit: Maximising return to shareholders, while being mindful of our overall responsibilities
 People: Being a great place to work, where people are inspired to be the best they can be
 Portfolio: Bringing to the world a portfolio of beverage brands that anticipate and satisfy
people's desires and needs
 Partners: Nurturing a winning network of partners and building mutual loyalty
 Planet: Being a responsible global citizen that makes a difference
 Productivity: Be a highly effective, lean and fast-moving organisation
Vision:
"To be a globally respected
corporation that provides best-of-
breed business solutions,
leveraging technology, delivered
by best-in-class people."
Mission Statement:
"To achieve our objectives in an
environment of fairness, honesty,
and courtesy towards our clients,
employees, vendors and society
at large."
Values:
We believe that the softest pillow is a clear
conscience. The values that drive us
underscore our commitment to:
Customer Delight
To surpass customer expectations
consistently
Leadership by Example
To set standards in our business and
transactions and be an exemplar for the
industry and ourselves
Integrity and Transparency
To be ethical, sincere and open in all our
transactions
Fairness
To be objective and transaction-oriented,
and thereby earn trust and respect
Pursuit of Excellence
To strive relentlessly, constantly improve
ourselves, our teams, our services and
products to become the best

8. 8
Vision:
"To be among the global top 10 by
2010 ."
Mission Statement:
"To help customers achieve their
business objectives by providing
innovative, best-in-class
consulting, IT solutions and
services. Make it a joy for all
stakeholders to work with us."
Q: TCS had a target to be a $10-billion firm.
Have you given any target to yourself in
terms of the company’s growth?
A: In a few days time, we will have a vision
statement but it will not be about numbers.
-N.Chandrasekharan, CEO
(Oct.07, 2009: Business Standard)
“TCS has become the world's 9th largest
s/w services company in terms of
revenues.”
For the $6.3 billion-TCS, the focus now "would
be to climb the value chain in a bid to
differentiate its services from competition,"
- Ratan Tata, Chairman
(July 03, 2010: The Times of India)
Objectives
 Define organization’s relationship with its environment
 Help pursue organization’s mission
 Basis for strategic decision making
 Standards for performance appraisal
 Translated to goals - attainable - specific

9. 9
Setting Objectives: 5 rules
 S pecific
 M easurable
 A ttainable
 R elevant
 T imely

10. 10
Hierarchy of objectives
 Divisional
 Departmental
 Functional
 Operational
What objectives are set?
Peter Drucker
1. Market standing
2. Innovation
3. Productivity
4. Physical & financial resources
5. Profitability
6. Manager performance & development
7. Worker performance & attitudes
8. Public responsibility

11. 11
How objectives are formulated?
Glueck
 Forces in environment
 Realities of enterprise’s resources & internal power
relationships
 Value system of the top executives
 Awareness by the management
Critical Success Factors
What to we need to do in order to be successful?
e.g. : Courier - reliability & speed
CSFs have an impact on profitability
Product attributes, competitive capabilities and market achievements
Scientific research, low cost efficiency, strong distribution network,
fast technical assistance, design expertise, image, managerial experience,
superior workforce talent.
ORIGIN:
The term 'critical success factor' was first coined by Rockart (HBR, 1979).
He defined it as:
“the limited number of areas in which results, if they are satisfactory, will
ensure successful competitive performance for the organization.’”

12. 12
Critical Success Factors
ELGI is based in Coimbatore TN (since 1960s)
Humble beginnings -
 Bus body building
 Wood-working machinery
 Reclaiming rubber from used tyres
 Automotive chains – Capturing OEM market with quality & reliability in delivery
 Garage Equipment – Customer service thru efficient after-sales service
"ELGI aims to get a sizeable share of the world market for its
compressors and automotive equipment business by 2015 "
Vision
 Rotary Compressor Division
 Reciprocating, Railways and Original
Equipment Division
 Automotive Equipment Division
 Engines Division
 Manufacturing and Engineering Services
5 Divisions
Identifying Critical Success Factors
 Basis on which customers choose brands or sellers - What product
attributes are crucial?
 Resources & competitive capabilities a seller needs to have to
remain competitive
 What enables sellers to sustain competitive advantage?
A critical success factor (CSF) is not a “key performance indicator” (KPI).
Critical Success Factors are elements that are vital for a strategy to be successful.
KPIs are measures that quantify objectives and enable the measurement of strategic
performance.
For example: KPI = number of new customers;
CSF = installation of a call centre for providing quotations

13. 13
Summary
Vision: Destination of business
Mission: Role they wish to play in society
Values: Beliefs that are shared among the stakeholders of an organization.
Purpose: Purpose(s) organization should strive for
Policy: Guidelines for action
Procedures: Series of related steps or tasks
Rules: Prescribed course of action
Strategy: Course of action or a plan - unified comprehensive and integrated - to assure
that the objectives of the organization are achieved.
Goal: Open-ended attributes denoting a future state or outcome of an effort put in now.
Objective: Close-ended attribute which is precise and is expressed in specific terms.
Objectives are often used to refer to end-situations whereas goals are about stages in
the process of reaching the objective.
Analysis

FACET 
FOCUS 
MOULDS MECHANISMS MANIFESTATIONS SWOT

InternalAnalysis
COMPANY • Vision, Mission, Values
• TOWS / SPACE matrix
• Biz Portfolios
• Structure
• Processes
• Systems
• Excellence
• Innovation
Strengths&
Weaknesses
CUSTOMER • Pricing Models
• Service-Profit Chain
• Co-Creation
• Activity Based
Management
• Balanced Scorecard
• Value Proposition
ExternalAnalysis
COMPETITOR • VRIO
• Value Net
• Hyper-Competition
• Competitive Intelligence • Competitive Advantage
Opportunities&
Threats
CONTEXT • PESTEL
• Five Forces
• Scenarios
• Foresight
• Knowledge
Management
• Early Warning Signals
• Blind spots
STRATEGY  FORMULATION EXECUTION & IMPLEMENTATION